Managing investment accounts in PocketSmith

Add your investment accounts to PocketSmith for a complete picture of your financial position 💰📈
Investment accounts are a bit different from regular accounts as, in addition to regular transactions, their balances are also affected by growth or loss which is usually not represented by transactions. Due to the way balances are calculated in PocketSmith, this can cause issues with tracking historic balances.
In this guide, we'll look at the best options for adding and managing your investment accounts, and how to account for any growth or loss. 
In this user guide

The difference between regular bank accounts and investment accounts in PocketSmith

Investment accounts are different from regular transactional accounts as, in addition to regular contributions (and possibly withdrawals), your investment balance is also affected by growth or loss, often not reflected by transactions. 

Because PocketSmith calculates historic balances for bank feed accounts using transaction data, adding your investment account as a bank feed account will mean that your historic balances are inaccurate. To get around this, you can periodically add manual transactions to account for growth or loss, or, you could add your investment account as an asset instead.

Note

Some Investment accounts that have an available bank feed function as  balance-only accounts, and do not import any transactions at all.

If this is the case, your current balance will be correct and up-to-date, but your historic balance will be inaccurate.

If you'd like to maintain a record of historical balances we recommend adding the account as an asset instead, updating the balance periodically as detailed here: Managing your investment account as an asset

What is the best way to add an investment account?

  • If your priority is to have an accurate current balance, and you're not overly concerned about tracking the historic balances, it is best to add this account as a bank feed account (if available).
  • If you would like a more accurate reflection of historic balances, or no bank feed is available for the account, it's best to add the account as an asset. 

Retirement funds

If you're looking to add a retirement fund, or employer-sponsored investment fund, where your contributions are deducted from your paycheck, you'll need to use a slightly different approach for managing and tracking contributions.

For detail on how to manage employer-sponsored funds please see: Tracking your retirement fund in PocketSmith


Options for adding your investment accounts to PocketSmith

There are two ways that an investment account can be added to PocketSmith:

  • As a bank feed account (if available)
  • As an asset

Which option is right for me?

The option that's right for you depends on a number of factors, including whether a bank feed is available for your investment account and whether you are happy with just the current balance being correct, or if you want a record of your historic balances for the account.

It's also important to note that, because gains or losses in an investment type account are not represented by transactions, these will need to be added manually if you want to maintain historic balances.

We've compiled a brief overview of both options below. Read on to learn more.

Adding your investment fund as a bank feed account

This option is great for keeping an up-to-date balance in your Net worth and allows you to import the transactions that appear within your investment account for reporting purposes.

The advantages of adding your investment account as a bank feed account include:

  • the current balance of the fund will always be up to date
  • transactions within the account are automatically imported

However, please note that manual transactions reflecting any gains or losses will need to be added periodically in order for the historic balances to be accurate. 

Adding your investment account as an asset

This option may be suitable for you if you would like your investment account included in your net worth and you want to forecast its growth, but you don't want to report on the gains or losses as part of your Income & Expense Statement, or don't want the transactions from the account cluttering up your day-to-day income and expenses.

  • no need to add or import transactions, and therefore no need to worry about how they will affect your income & expense reporting
  • use a repeating budget to reflect your contributions. The budget will automatically update the asset balance accordingly.

Please note that balance adjustments reflecting any gains or losses will need to be added periodically in order to keep the balance up to date.


Managing your investment account as a bank feed account

Adding a bank feed account

If bank feed support is available for your investment account, and you decide you would like to add it to your PocketSmith as a bank feed account, then you can learn how to do this here: Adding a bank feed and establishing your accounts

Categorizing your transactions

Once your account has been added and the transactions imported, you'll need to determine how you'd like to report on the transactions and categorize them accordingly. 

Since your contributions to your investment accounts are transfer transactions, we generally recommend you assign these to a transfer category. You can learn how to create a transfer category here: Steps to create a transfer category.

Budgeting & forecasting

Add a repeating transfer budget from your main account to your investment account in order to reflect your regular contributions and include them in both accounts' forecasts.

For more detail on creating a budget please see: Creating a transfer budget

Accounting for gains/losses

Often, gains and losses are not recorded as transactions within an investment account, however, you may wish to periodically add manual transactions to reflect any gains or losses in order to keep your historic balances accurate.  

Historic balances for bank feed accounts are calculated using the current bank feed balance as a starting point, with transaction data added and subtracted to determine any closing balances. This means that the current balance will be correct, however, the historic balances may be inaccurate due to the gains and losses not being included as transactions. 

To learn how to add manual transactions to an account please see: Manually add transactions to my account


Managing your investment account as an asset

Adding an asset

If you decide that you'd like to add your investment account as an asset, you can learn how to do this here: Adding an asset to Net Worth

Tracking your contributions using a transfer budget

Once the asset has been added, you're able to add a repeating transfer budget to reflect any contributions made from your Main account to your Investment account. The budget events will automatically update your asset balance accordingly, as well as include the budget events in both accounts' forecasts

To do this, you'll need to create a new category, eg. Investment contributions. It's best to set this category up as a transfer category.

Next, you'll need to create a transfer budget for your Investment contributions category, reflecting the transfer from your 'Main account' to your 'Investment account'.

For detail on how to do this please see: Setting up a transfer budget for an asset

Updating the asset balance to account for gains/losses

In order to account for any gains or losses to your investment account, you'll need to periodically add a manual balance adjustment as outlined here: Updating the value of an asset or liability from the Calendar page


Adding your share portfolio to PocketSmith

If you have a range of investment accounts in a share portfolio, and just want to include the portfolio balance in your PocketSmith account in order to include this in your overall net worth, we recommend adding your share portfolio as an asset

You can use a transfer budget to reflect any regular contributions toward your portfolio.

To account for growth or loss, you'll need to update the balance of the asset periodically. We've got all the detail on how to do this here:  Updating the value of an asset or liability from the Calendar page.

Note

Please note that PocketSmith does not have a detailed share tracking feature. If you want detailed share tracking we suggest using a dedicated provider, such as Sharesight.

You can then add your portfolio balance to PocketSmith as an asset as detailed above.

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